B.C. Finance Minister Kevin Falcon unveiled on Tuesday a politically expedient, hold-the-line budget, probably all that can be expected from someone in his position. With a provincial election looming and his ruling Liberal party falling in the polls, and with global economic uncertainty obscuring his vision, the Minister had his work cut out for him. He delivered what some non-partisans and moderates say resembles a realistic fiscal plan for the future.

But the province needed tough love, and Mr. Falcon wasn’t nearly mean enough. The province continues to spend more than it receives. And its debt continues to grow, an unsustainable trend that Mr. Falcon plans to follow.

He’ll never say it, but he has crafted a document meant first and foremost to shield his government from political challenges, from opponents on the left and right. In truth, the fiscal plans and outlooks he presented Tuesday are almost meaningless. They impart a political tone, hint at an agenda for the coming election cycle, and that’s about it.

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British Columbians have seen how quickly and dramatically government forecasts can go wrong. For the current fiscal year, which ends next week, the province had predicted a deficit of $925-million. This was revised once, twice, three times, and finally settled at $2.5-billion. Ouch.

Mr. Falcon must be modest. He says things are looking a little brighter. He’s still sticking to a pledge made by his predecessor, former B.C. finance minister Colin Hansen, to return the province to the black in 2013, the year ratepayers return to the polls. To meet an even larger, $250-million surplus projection the year after that, his government must reach some pretty lofty revenue targets. Mr. Falcon sees the province achieving 23% more profit from natural resources than it did this fiscal year, and 11% more revenue from income and corporate taxes. It assumes 12.4% more profit will be squeezed from gambling sources by 2014, and so on.

If things don’t work out as planned, he has a stop-gap: a 1% hike to the corporate tax rate, to kick in down the road. But that would raise only a few extra hundred million.

The good news is Mr. Falcon plans to slow government expenditures. He projects a total spending increase of $800-million from current levels through the fiscal year 2014-2015. He also announced in his budget a “release of surplus corporate assets,” otherwise known as a property dump.

Mr. Falcon says B.C. can raise around $700-million in the next few years by getting rid of surplus and vacant land owned by the province. “The inventory of surplus corporate assets includes, for example, a parking lot near the legislative buildings in Victoria, six hectares of vacant land in Surrey zoned for commercial and multi-family use, and a seven-hectare site north of Kelowna that was being tentatively held for the new correctional facility that will now be built near Oliver [in the B.C. interior],” according to budget documents released Tuesday.

As part of the same plan, the government announced its intention to privatize its two liquor distribution facilities, in Vancouver and Kamloops. Mr. Falcon says private business can run the facilities more efficiently, even with the same number of staff, most of whom are union members. His government will not go the next step and sell off its retail liquor operations, which employ another 3,100 full- and part-time workers. Booze sales spill about $900-million into the province’s coffers each year.

Other budget announcements that received big media play include a “comprehensive review” of the province’s controversial carbon tax, which rakes in almost $1-billion annually. “The review will cover all aspects of the carbon tax, including revenue neutrality, and will consider the impact on the competitiveness of B.C. businesses such as the agricultural sector, and in particular, B.C.’s food producers,” the budget reads.

Such measures do nothing for the bottom line. They are written into budgets to appease and distract. The most important takeaway from Tuesday? Even if Mr. Falcon’s projections hold, the province will continue to move in the wrong direction. Through 2014, its accumulated debt will grow an average of 9.3% a year, to $66-billion, and there’s just no way to disguise that. National Postbhutchinson@nationalpost.com

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